Russian president Vladimir Putin said that effective legislative regulation for the country’s cryptocurrency market will be needed in the future.

“This is the prerogative of the Bank of Russia at present, and the central bank has sufficient authority so far,” Putin said. “However, in broad terms, legislative regulation will be definitely required in the future.”

The president noted that the central bank has been acting conservatively in the cryptocurrency area, but said that such an approach is not without reason.

“It is known that the cryptocurrency is not backed by anything,” he said. “It cannot be a store of value. No material valuables are behind it and it is not secured by anything. It can be a settlement medium to a certain degree and in certain situations. This is done quickly and efficiently.”

Putin also compared the risk level of crypto investments to shared-equity construction. “We cannot afford recurrence of the situation with the cryptocurrency, as it happened with construction investors. If we regulate and, furthermore, regulate insufficiently effective, then the state will be responsible for the grave situation the people may face,” he said.

Earlier this week, Russian Deputy Finance Minister Alexei Moiseev said that the ministry drafted a bill to legalize the trading of cryptocurrencies on approved exchanges. The bill would allow for more open cryptocurrency trading and investment within the country.

“We do not want to over-limit and over-regulate, but we will set some limits,” Moiseev said. “The general idea that it will be that you are allowed to buy and sell cryptocurrencies only on exchanges with official status and assets will have to be declared and legalized.”